EOL Candidate Proposal: Prime Protocol

EOL Allocation Candidate
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Introduction

Prime Protocol is DeFi’s first natively cross-chain prime brokerage that allows users to borrow across chains backed by their entire portfolio of cross-chain assets.

This proposal is about bringing Mitosis’ Ecosystem-Owned Liquidity (EOL) to Prime. The Prime team is excited and honored to become the very first EOL Candidate project to open up an avenue of discussion about what we believe is the future of TVL provisioning.

About Prime

Email: contact@primeprotocol.xyz

The Prime Value Proposition

Prime Protocol is uniquely positioned to bring synergies to different ecosystems through its cross-chain capabilities. More specifically, Prime can onboard users from different blockchains. We safely and efficiently accomplish this in a few ways:

UX optimization through frictionless cross-chain lending

Prime allows users to pay for gas on one chain and borrow assets on another, eliminating massive friction points for users joining a new ecosystem.

For example, an avid user of Optimism wants to participate in timely yield opportunities on Arbitrum. Instead of reading up on bridges and custom DEXs to swap tokens, this user can borrow USDC on Arbitrum with collateral on Optimism and pay for the transaction on Optimism. This conveniently provides immediate liquidity to users on Arbitrum.

Securely capture multi-chain opportunities with minimized complexities

Prime reduces the need to bridge over assets to participate in another chain manually. Prime’s general message passing infrastructure allows secure data transfer between the supported chains. In other words, Prime greatly reduces users’ cross-chain transaction risk by letting them take positions without transferring assets. Existing single-chain users can earn interest by easily depositing in Prime. New users can seamlessly commit collateral in their chains to quickly participate in new money markets and opportunities.

Leadership Team

The team at Prime Protocol is led by individuals with a rich blend of experiences in both traditional finance and the burgeoning field of decentralized finance (DeFi), positioning them uniquely within the crypto space.

  • Neeraj Kohirkar (Founder/CEO)
    Neeraj is a seasoned engineer and tech expert with extensive experience, including engineering lead at Netflix and advisory roles in leading fintech startups. His entrepreneurial background led him to enter the crypto space in 2017. With a deep understanding of technology and finance, Neeraj leads the Prime team in building a scalable system while fostering innovation in crypto. Neeraj holds a Bachelor’s degree in Interdisciplinary Studies from UC Berkeley.

  • Colton Conley (Co-founder)
    Colton has been a long-time crypto investor and trader since 2016, kicking off his crypto career by developing arbitrage bots for centralized exchanges. He previously worked as a quantitative trader specializing in interest rate volatility for bulge-bracket financial institutions like JP Morgan and Citadel. Colton’s transition from a traditional finance expert to a DeFi innovator was driven by his firsthand experiences as a DeFi user. Colton holds a B.S. in Statistics, Data Science, and Economics from Yale University, where he was honored with the Tobin Fellowship for his cryptocurrency research.

Audit History & Security Vendors

The code of Prime Protocol undergoes constant and meticulous auditing processes. Veridise and Ackee have audited our live product. You can find the audit details on Prime’s Audits page.

Prime has never experienced any security incidents or exploits since its mainnet launch.

Investors/Fundraising

Prime Protocol completed a Seed round in 2022, with Framework Ventures, Arrington Capital, and Jump Crypto leading the round. Prime is also raising a strategic round to bring more capital and investors to help accomplish our exciting goals for the year.

Prime as a Mitosis EOL Protocol

Both Mitosis and Prime aim to introduce a new DeFi paradigm with seamless multi-chain UX and increased market efficiency. As blockchain deployment becomes easier and more cost-efficient, the upcoming multi-chain future presents tremendous opportunities for Mitosis and Prime. However, the competition for TVL is bound to equally intensify, encouraging protocols from different networks to vy for liquidity to bootstrap. Especially in light of the ongoing conversations about the ambiguity of LP reward distribution methods, achieving transparency and information symmetry is a key step required to take the DeFi market maturity to the next level.

Prime can greatly benefit from sharing the Mitosis EOL liquidity to establish a strong presence across its supported networks. Instead of relying on a capital-intensive, largely unsustainable method of directly procuring TVL through marketing, Prime can offer exclusive deals catered to Mitosis EOL for a more secure, predictable liquidity. As Mitosis expands its network and asset coverage to new frontiers, Prime can seamlessly tag along by gauging the EOL liquidity levels in different networks and proposing additional allotment.

Mitosis EOL also benefits by providing liquidity to Prime. EOL LPs receive exclusive rewards tailored for only themselves, potentially earning more than non-EOL participants with the same amount of asset commitment.

We believe Prime Protocol offers the following utilities to the weETH deposited via Mitosis EOL:

  • Earn variable interests as Prime’s cross-chain lending platform LPs
  • Automatically participate in the Prime Points program for future Prime tokens
  • Additional customized rewards that exclusive agreements between Mitosis and Prime Protocol will establish

Prime’s Proven Track Record

Prime Protocol has a documented history of effective and sustainable partnerships.

  • In April 2023, Prime Protocol received a grant from the Moonbeam Foundation, which led to increased usage of Moonbeam’s Cross-Chain Connected Contracts. Prime shortly became the second largest protocol by TVL in the Moonbeam ecosystem, with only a fraction of total grant funds being distributed.

  • The increased attention to the Moonbeam ecosystem contributed by Prime is apparent when looking at our Axelar message passing statistics. Prime accounts for over 99% of the 35k total GMP calls to Moonbeam since its launch. Rather than relying on attracting mercenary capital, Prime has steadily built TVL that has remained quite sticky through different yield environments.

  • Prime also recently received approval from the Arbitrum Grant program. We plan to deploy the capital received in the summer of 2024.

  • Noteworthy points on the Prime KPI

    • Total Value Locked: US$10M
    • User engagement: Over 74K users have accessed Prime Protocol’s website
    • International representation: Just in 2024, we had 9.5K new users from India, 7K from the UK, and 6K from Singapore, with plenty of engagement from China, Korea, Russia, the Netherlands, and other regions across the world
    • User retention: Since the mainnet launch, we’ve constantly been maintaining an average of 40% retention rate of users who spend 3-5 minutes on the app per session
    • Point distribution: Over 40 million Prime Points distributed to 12.5K users
72 Likes
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Mitosis first cooking! :fire:

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Mitosis is not only about staking, it’s introduce us to a modular era. :smiling_face:

12 Likes
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You guys have been busy!!! cool

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exactly that… a great step forward

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we need this. prime gives us great way to put our miweETH to work.

6 Likes
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you great! I have been supporting you and this quality project.
lets make it great with community

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im hyped for next news :heart_eyes:

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Looks great! Mitosis is cooking the right things :smiley:

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Sounds like a great proposal

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Good one. Thanks for this proposal.

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Loved this one.
It is really going beyond what I expected!!!

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this is mitosis bradah LFG !!

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good collaboration working Prime. Correct way forward.

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Congrats for the Partnership

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Been a user of Prime Protocol for a long time, their team are very good and the protocol is super useful

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Reducing complexity for users, embracing modular era - loving it!

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Mitosis is the best, looking forward to it.

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Currently, Mitosis has a TVL of 10.8k ETH (~$40,000,000). That’s 4x the TVL of Prime, which has existed since at least 2022. The benefits to Mitosis users should be commensuerate with the disproportionate value Mitosis brings to Prime - both in terms of monetary value and brand recognition in this space.

I’m for this collaboration, but I have some concerns.

There are many attack vectors with this type of cross-chain protocol and the mose recent auditing report from June 16, 2023 has some very concerning findings:

  1. The PrimeProtocol developers provided the source code of the Prime Protocol contracts for review. Based on the Veridise auditors’ assessment, the code is largely unchanged compared to the version audited previously (which was April 11, 2023).

  2. The audit uncovered 22 issues, 1 of which are assessed to be of
    high or critical severity by the Veridise auditors

  3. The Veridise auditors also identified several medium- and low-severity issues, including a reentrancy attack vector in the StakingPool component and a potential subtraction overflow when updating interest rates.

The following recommendation was made by the auditors:

Recommendations. After auditing the protocol, the auditors had a few suggestions to improve the Prime Protocol. First, we recommend that the Prime Protocol developers address the recommendations in the previous audit report. Second, as this audit discovered more issues related to rebasing tokens, including the 1 high-severity issue, we recommend that the Prime Protocol developers ensure that rebasing tokens are thoroughly tested before they are enabled on the protocol.

The above is very concerning.

as this audit discovered more issues related to rebasing tokens, including the 1 high-severity issue, we recommend that the Prime Protocol developers ensure that rebasing tokens are thoroughly tested before they are enabled on the protocol.

I ask that Prime thoroughly test rebasing tokens per the auditors recommendations before receiving Mitosis EOL via miweETH.

Based on the Veridise auditors’ assessment, the code is largely
unchanged compared to the version audited previously.

we recommend that the Prime Protocol developers address the
recommendations in the previous audit report.

What is the justification for not implementing the code changes from the auditor’s April 11, 2023 report? The team had over two months to implement the changes and apparently made little to no changes. This is unacceptable.

If Mitosis users are to provide their funds, Prime should do their due diligence and routinely update their codebase per the auditor’s recommendations. This gives assurance to users that their funds are safe.

Lastly, I’d ask for a new audit before the collaberation since their last audit was a year ago and their is no indication that the Prime devs have either addressed or implemented “the recommendations from the previous audit report.”

Again, I’m for this collab but don’t see a need to rush anything. Let’s get all our ducks in the row before hand to ensure that user funds are safu.

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all issues raised are fair…especially the issue concerning rebasing…Prime should look at the concerns raised by auditors and re-evaluate their code…all is well it is important to take calculated and thought after steps in this early stage when considering partnerships for Mitosis.

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